Our guest is Republican Congressman John E. Sununu, senator-elect from New Hampshire.

Thanks for coming in, John.

REP. JOHN E. SUNUNU (R), NEW HAMPSHIRE SENATOR-ELECT: Great to be here.

SHIELDS: Good to have you.

After an absence of four years, United Nations weapons inspectors returned to Baghdad. Iraq's government must report its weapons of mass destruction by December 8.

President Bush commented from Prague, site of the NATO summit.

(BEGIN VIDEO CLIPS)

HANS BLIX, CHIEF U.N. WEAPONS INSPECTOR: If the answer of the Iraq government were to be that there aren't any, (UNINTELLIGIBLE), whatever, then it must be convincingly shown that they -- by documentation and by evidence that nothing is remaining.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Saddam Hussein has been given a very short time to declare completely and truthfully his arsenal of terror. Should he again deny that this arsenal exists, he will have entered his final stage with a lie.

(END VIDEO CLIPS)

SHIELDS: Earlier, President Bush had said war was not inevitable.

(BEGIN VIDEO CLIP)

BUSH: My first choice is not to commit our troops to regime change. I hope that Saddam Hussein does what he said he would do, and that is disarm. And the inspectors are not the issue. The inspectors are simply a means to determine his willingness.

(END VIDEO CLIP)

SHIELDS: Al Hunt, is the president now serious about avoiding war?

AL HUNT, WALL STREET JOURNAL: Mark, I thought the more relevant comment was when he said that Saddam must completely and truthfully disclose all of his weapons of mass destruction by December the 8th. Saddam won't do that. I don't know anybody who thinks that he will. And I think shortly thereafter, the president will set in motion declaration that he's in material breach of the United Nations resolution, and I think the probability remains that there will be American troops in Baghdad in February.

SHIELDS: Troops in Baghdad, Bob, in February.

ROBERT NOVAK, CHICAGO SUN-TIMES: Probable, but not certain. I think that if you read literally what the president said, just on that sound bite, he's saying if they don't declare they have them, we don't care what the inspectors do, they are in violation.

But I think that was -- I am told that that was kind of some red meat for the people at the Pentagon, who are very upset that they're getting eased out by Colin Powell. They're unhappy about Bob Woodward's book, "Bush at War," which doesn't make Don Rumsfeld look very good and makes Colin Powell look good.

And so I think this was just appeasing them. I noticed that the president in Prague did not mention regime change. I really do believe that there is a chance that if -- and this is a huge if -- Saddam Hussein plays it smart, we can still avoid a war.

SHIELDS: Now, the resolution, the U.N. resolution, as I understand it, says must list his weapons of mass destruction and not (ph) comply with inspectors. I mean, there were two conditions to be met. And so the suggestion here, I guess, is that the president is going to go just on one.

John, your own assessment, senator-elect John (UNINTELLIGIBLE)?

SUNUNU: The declaration's important, that's the first step. I think Al's right, you probably will see some maneuvering on declaration. They won't fully declare, and then it'll be incumbent on the inspectors to do their job. I don't think the president will rush to judgment. I think he'll allow the inspectors to complete their work, to come back to the U.N. Security Council and to declare a level of compliance.

And it's only at that point that the U.N. Security Council will have a chance to let the world know if it's going to take action, and if they don't, then the administration will work with the coalition partners to take action, I think threat -- predicting troops in Baghdad in February is a little bit premature. HUNT: (UNINTELLIGIBLE) there's a probability, but you're right.

SHIELDS: Margaret Carlson.

MARGARET CARLSON, TIME MAGAZINE: I think there's -- Bush would be able to declare a material breach on December 9 if he wants to flyspeck the agreement. I mean, the letter of acceptance from Saddam Hussein is a material breach in that he says he has no weapons of any sort.

So he's going to have to go some distance on December 8.

You know, Hans Blix is going to know partly how much that list is not in compliance with what he already knows, and what the inspectors have to do their search is so much more sophisticated than it ever has been that they can quickly see whether Saddam is in material breach.

But Bush doesn't want to go to war yet. He wants to buy time too, because we're not ready.

SUNUNU: He also wants to fully make the case. And I think that's why...

CARLSON: He doesn't want to move any...

SUNUNU: ... there'll be a tempered response...

CARLSON: ... of (UNINTELLIGIBLE).

SUNUNU: ... to the declaration on the weapons.

NOVAK: I think this is the question. Is -- are there people in this administration who would say, Boy, if we could get him to really -- I mean, I still have not seen these weapons of mass destruction. That's the interesting thing, they're a kind of phantom, and...

SHIELDS: But if he would comply.

NOVAK: But if he would comply, you know, we can avoid people getting killed. We can get bloodshed (ph). But you see, there are people in the Pentagon who do not want this man to continue in power. There are people in Jerusalem who don't want this man to continue in power.

And that's why President Bush right now is driving them nuts, because he is not -- he is not clear that he is in that camp.

SHIELDS: Let me, let me jump...

CARLSON: But the bulk of opinion is with Colin Powell. Excuse me, Mark.

SHIELDS: No, I just wanted to ask, I just want to ask one question. I mean, George W. Bush, talk about assembling a coalition. Was NATO a success, the NATO summit, was it a success for the president? Is he benefiting from low expectations again, or... HUNT: Oh, sure, I think it was a success, because I slightly disagree with Bob. I think there are not only people in the Pentagon but people in the White House who think that regime change is the -- you know, should be a policy.

SHIELDS: I think including the vice president.

HUNT: And certainly including the vice president. I think the president is there some days. But Bob, I just don't think that -- I think there's -- I disagree with you, I think there's indisputably weapons of mass destruction there. I don't think Saddam will ever, ever give them up. I don't think he'll ever be honest. That's, that's, that, that would defeat his whole, his whole raison d'etre in that region.

And I think George Bush is not going to tolerate a Saddam Hussein sitting around thumbing his nose at us, you know, six month or a year from now.

NOVAK: Why, why, if they...

SHIELDS: Bob.

NOVAK: ... have, if they have indisputable evidence, why don't they present it out to the U.N. like Adlai Stevenson did?

HUNT: Well, they did in 1998, Bob, and they did...

(CROSSTALK)

SUNUNU: And that's exactly what the weapons inspectors will do once they come back to the U.N. Security Council.

But Prague was a success for two particular reasons. One, you saw the enlargement, but even beyond that, you saw a unified NATO declaring support for what the U.N. Security Council said, and if, de facto, the United Nations -- the United States position that there has to be full disarmament, and the United States is going to take the lead there.

The second success of Prague was in a redefining of NATO's mission. You see a discussion about global terrorism, the elimination of weapons of mass destruction, and the beginnings of a specialization within NATO to take on additional roles of NATO's military mission.

And I think in reshaping NATO, in addition to the enlargement, that's a real success for the president...

CARLSON: (UNINTELLIGIBLE)...

SUNUNU: ... and for the NATO leaders.

SHIELDS: Go ahead, Margaret.

CARLSON: ... Bush still needs to do some work on bringing Germany back in on this. There still seemed to be some tension there. You know, Bush...

NOVAK: We really hate, we really hate...

CARLSON: ... (UNINTELLIGIBLE)...

NOVAK: ... to see a peaceful Germany, don't we?

CARLSON: ... Bush may, you know, actually like the position he's in, where he has the U.N. behind him, he doesn't want to do what Adlai Stevenson said because now when there is a material breach, they, you know, these countries do have to come along with us. He didn't want it, but now he has it...

SUNUNU: That's a great point.

CARLSON: ... he kind of likes it.

SHIELDS: Last word, Margaret Carlson.

John Sununu and THE GANG will be back with the passage of homeland security, plus a couple of other things.

(COMMERCIAL BREAK)

SHIELDS: Welcome back.

In the lame-duck session of Congress, passage of the homeland security bill was threatened when House Republicans secretly added pro-business provisions. Democratic leaders and moderate Republicans protested.

(BEGIN VIDEO CLIPS)

SEN. TOM DASCHLE (D-SD), MAJORITY LEADER: Is arrogance is an atrocious demonstration of demeaning the legislative process. They ought to be ashamed of themselves.

At the 11th hour, when nobody was watching, when most people had gone home...

SEN. SUSAN COLLINS (R), MAINE: We made very clear to our leaders our unhappiness not only with the provisions but with the process, which really represented politics at its worst. It was a back-door, end-of-the-session deal that was cut in the middle of the night...

(END VIDEO CLIP)

SHIELDS: An attempt to eliminate the House provisions failed narrowly.

(BEGIN VIDEO CLIP)

DASCHLE: With all my reservations, I still intend to support final passage, simply because I want to send as clear a message about our strong desire to put in place the new governmental infrastructure to deal with the threats that we are now facing.

(END VIDEO CLIP)

SHIELDS: The final bill passed 90 to 9, and President Bush telephoned his thanks from Prague.

(BEGIN VIDEO CLIP)

SEN. DON NICKLES (R-OK), MINORITY WHIP: Mr. President, I just thank you, you're the one that said you really wanted to get this done this year, and because of that, you kept us -- our feet to the fire...

NOVAK: They were intimidated into voting for it. I just Senator Daschle. He was so outraged about this terrible bill, and then after the -- his provision didn't pass to get the, those, those House provisions out, he said, Yes, going to vote for it. Why did they vote for it? Because they think that Max Cleland in Georgia and Jean Carnahan in Missouri were defeated on the issue.

I don't think that was the only reason they were defeated. And they're afraid if, if Mary Landrieu were to be defeated in Louisiana in the runoff on December 7, that would also be laid at the, at the feet of this.

As for these House provisions, they are just attempts to (UNINTELLIGIBLE) protect the pharmaceutical industry from the deprivations of the trial lawyers.

See, the trial lawyers are the major political cash cow for the Democratic Party, and I'm just amazed how the press, and I'm not talking about the people on this panel, who are ideological, but the people who are supposed to be straight, just write this as a terrible thing that anything the powers (ph) is OK, but when you try to produce drug companies who are trying to help something for the American people, it's an outrage.

SHIELDS: Well, let me just make one point, Bob. If it were really so good, why wouldn't it take the daylight? Why wouldn't it be done openly and freely?

HUNT: Good question.

NOVAK: (UNINTELLIGIBLE), I'll, I'll explain.

(CROSSTALK)

NOVAK: I'll explain it you, because...

SHIELDS: OK...

NOVAK: ... I've been, I've been covering legislative (UNINTELLIGIBLE) since 1954, and things get done better at night in the ark when you don't have a lot of lobbyists around...

SHIELDS: And a lot of press...

NOVAK: ... pushing in the other direction.

SHIELDS: ... reporting to the public.

Margaret?

CARLSON: No, it's at, it's at dark, in the night, when you do have the lobbyists around pushing their special provisions. And to take a national security bill and turn it into a Christmas tree for special interest ornaments is an outrage. It's a terrible thing to have done.

But did everybody have to vote for the homeland security bill? Did the Democrats get bullied into it? Yes, because in fact two senators did die on the basis of that bill, especially Max Cleland. I'm not -- there may have been other factors with Carnahan, but wall- to-wall ads calling Max Cleland unpatriotic did kill him.

SHIELDS: They didn't unpatriotic...

NOVAK: They didn't call him unpatriotic...

CARLSON: (UNINTELLIGIBLE)...

SHIELDS: ... they just, they just pictured him with...

CARLSON: (UNINTELLIGIBLE)...

SHIELDS: ... Osama bin Laden and Saddam Hussein.

CARLSON: (UNINTELLIGIBLE), yes.

SHIELDS: John.

SUNUNU: Well, the Democrats rolled over on this for all the right reasons, because this is about giving the president (UNINTELLIGIBLE) the president flexibility he needs to move the right people into the right place at the right time in the new Department of Homeland Security. Doesn't matter, matter whether it's day or night. And the process wasn't a very good one, there's no doubt about that.

At the same time, this issue about liability limitation and in a case of terrorism was on the issue on the table in terrorism risk insurance, it's been on the table in other issues that we've dealt with in the wake of September 11. A terrorism -- terrorist attack should not be a feeding frenzy for the trial lawyers.

We should make these liability provisions and protections fair and more balanced and broader. We shouldn't highlight specific industries for this kind of treatment. And the final provision that they were protesting was Texas A&M research facility. That's obviously geared toward Phil Gramm, who's retiring from the Senate.

Let's face it, that kind of thing happens all the time in every state in the country, whether it's the House...

CARLSON: But not in national...

SUNUNU: ... or the Senate.

CARLSON: ... not on a national...

(CROSSTALK)

SUNUNU: Oh, I don't disagree, you're absolutely right on that point.

SHIELDS: ... freedom for Eli Lilly, for liability, for a vaccine that causes childhood autism, is -- has nothing to do with national security.

HUNT: Bob, (UNINTELLIGIBLE), who sponsored the provision?

NOVAK: That doesn't make any difference...

HUNT: Bob, can you answer the question?

NOVAK: ... (UNINTELLIGIBLE) -- that, that, that, that...

HUNT: You can't answer the question because they won't tell you who sponsored it. That's a very good answer, Bob. And let me tell you this.

NOVAK: Doesn't make any difference.

HUNT: This is, this has nothing -- Bob may think that autistic kids aren't part of the productive element of American society, and perhaps they're not, Bob. But let me -- and maybe there's no case here. And John, maybe there's a thing about liability. But this was Congress in a political payoff to drug companies saying, these people, whether they have, whether there's merits to it or not, we're not going to let you do it.

That's outrageous.

The other provision that came in there, to retroactively say that those sleazy companies who did airport security -- two widows came down from New Jersey to tell Congress, Don't tell us we can't sue. We can hold them personally accountable. Maybe they have no case. Congress has no right butting in.

And they did it to pay off drug companies. "The New York Times" reported that drug executives flew into Dulles Airport for a secret meeting this week to say, How are we going to reap the dividends from the millions we gave on election day?

NOVAK: Al...

HUNT: And it began this week.

NOVAK: Al, the -- this, this, this this is in -- the outrage is that the trial lawyers attacking the...

HUNT: Oh, that's, that's...

NOVAK: Just let me, (UNINTELLIGIBLE), wait, wait a minute...

HUNT: ... a distraction.

NOVAK: I didn't, I didn't interrupt you.

HUNT: It's a great distraction.

NOVAK: I didn't interrupt you, Al.

HUNT: Yes, you did.

NOVAK: I did not interrupt you. I said that the outrage is these sleazy -- you used the word "sleazy," and I'll use them, trial lawyers attacking pharmaceutical companies on the vaccines. They've been after the vaccines for years, and an attempt to try to protect the pharmaceutical manufacturers from the bar is an important thing.

I just can't understand, Al, I'm disappointed in you that you find yourself in bed with these peeper, these people who are the cash cow for the Democratic Party.

HUNT: I'm disappointed that you consider autistic kids so irrelevant...

NOVAK: (UNINTELLIGIBLE)...

HUNT: ... that it doesn't matter. That's exactly what it is, Bob, and you won't face up to it.

SHIELDS: Can I just say one thing? The other provision in there was to allow companies that move offshore to avoid paying U.S. taxes...

HUNT: (UNINTELLIGIBLE).

SHIELDS: ... OK? AWOL companies, all right? In a time of war, to sell contracts and to national security, paid for by the families and the taxes of those in service and those...

NOVAK: You know what the answer is?

SHIELDS: ... (UNINTELLIGIBLE). (UNINTELLIGIBLE) say what the answer is to it, John McCain called it war profiteering...

NOVAK: I'll tell you what the...

SHIELDS: ... and he was right.

NOVAK: Can I tell you the...

(CROSSTALK)

NOVAK: ... the answer, the answer to it is to lower the U.S. taxes so they don't have to move away.

(CROSSTALK)

SHIELDS: Oh, baloney! Boy, why don't you move offshore?

(CROSSTALK)

SHIELDS: Next on CAPITAL GANG, Al Gore returns again.

(COMMERCIAL BREAK)

SHIELDS: Welcome back.

Al and Tipper Gore continued a book tour, constituting the former vice president's most intense political activity since the 2000 election. Is he running of president in 2004?

(BEGIN VIDEO CLIP, "20/20," ABC)

AL GORE, FORMER VICE PRESIDENT: But I'm not going to make a decision until the end of the year. After the holidays are over, I'll have an announcement.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP, "THE TODAY SHOW," NBC)

GORE: We should have tax cuts for middle-income families, not for the very wealthy. That's where the Bush plan has most gone wrong.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP, "LARRY KING LIVE")

GORE: I think that the administration lost focus where the war on terrorism is concerned...

CARLSON: Well, he's tanned, he's ready, he's rested, and he'll let us know just how ready he is in January.

(UNINTELLIGIBLE) he, he kindled talk show host enthusiasm for himself...

SHIELDS: It's a hell of a rollout, (UNINTELLIGIBLE).

CARLSON: ... wow. And the envy of many other Washington figures...

SHIELDS: (UNINTELLIGIBLE)

CARLSON: ... yes, who might get on. But his script that he's unscripted is disproved by the fact that he says the same thing, just about, at every, at every stop.

Democrats look pained, the big fund-raisers, at times, about having to say yes or no to Al Gore. Some say as Bush gets stronger, however, perhaps, let's let Gore have it this time, and let him lose fair and square.

SHIELDS: Just like in 1992 they said, Let's let Bill Clinton have it, and...

OK, go ahead, John Sununu.

SUNUNU: I don't think anybody said, Let's let Bill Clinton have it. I think there were a few people that...

SHIELDS: (UNINTELLIGIBLE)...

SUNUNU: ... stepped back...

SHIELDS: ... (UNINTELLIGIBLE).

SUNUNU: ... that's right, it was the B-team at the time. Al Gore is not going to run for president in 2004, because he'll only have one more chance to run for president, and his choice is going to be to run in 2008.

SHIELDS: (UNINTELLIGIBLE) 54, 55, I guess.

SUNUNU: And what he's -- What he's doing...

SHIELDS: (UNINTELLIGIBLE).

SUNUNU: ... is consolidating liberal interest groups, those that have a strong influence in the primary process, reinforcing his credentials. He's against extending the tax cuts, making them permanent. He's trying to oppose the president and his initiatives in Iraq. He's, you know, taking positions for nationalized health care.

So he's consolidating that base. He'll make a decision that he's not going to run. But at the same time, in consolidating the base, remain a player in the run-up to 2008, and even remain a player in the selection of the nominee for 2004.

SHIELDS: Can't accuse John Sununu of tip-toeing around.

HUNT: No, eh, that's good.

SHIELDS: I mean, there's a, there's a solid prediction.

How about it, Novak?

CARLSON: (UNINTELLIGIBLE).

SHIELDS: You going to go on record as tough?

NOVAK: I don't think he's going to run either. But I'll tell you this, if he did (UNINTELLIGIBLE) enthusiasm of Republicans, because they, they took a look at those (UNINTELLIGIBLE), and they said, Man, we -- let's try it again, this time we can win easily.

The thing that amazed a lot of Democrats, and amazed me, is that he had this whole year or two years of sitting around, God knows what he was doing that -- during that period of time. And he didn't come up with anything.

You know, I mean, if you look -- I read all, all these interviews, and it's all cliches, it's all stuff other people have said, have said before. There's nothing new, there's nothing -- all that stuff about taxing the rich, it didn't work in the, in the 2002 campaign.

I know that the Democrats can do better than that, and I'm sure they will in 2004.

SHIELDS: Nothing new like compassionate conservative.

Al Hunt.

HUNT: I thought Gore was terrific on the Letterman show. I was really stunned at how good he was, and seemingly natural. And then the rest of the rollout just baffled me. I'm not quite sure what he was trying to achieve. I certainly didn't think it made much sense to do it all the way he did it. And the only people who didn't get an interview with Al Gore this week were the, were the, were the four of us, and I guess John Sununu too.

I think the senator-elect, though, may well be onto something. I'm not at all convinced that he's going to run. I think, John, you may have analyzed it, you know, pretty well. We'll see.

SHIELDS: Well, I mean, I detected a certain ambivalence on his part. I wasn't as sure as John. But I -- it was an impressive rollout, and I'll say this. If Al Gore does run, the candidate who (UNINTELLIGIBLE) -- if he does win the nomination, he will be a far different candidate than the fellow who won in 2000, when the nomination was essentially given to him by all the interest groups. He's got to go out and win voter support like he didn't have to do the last time.

And for that reason, he'll be a better and different candidate, and not quite the cakewalk that...

NOVAK: (UNINTELLIGIBLE)...

SHIELDS: ... you anticipate.

NOVAK: ... I have heard so many rebirths of Al Gore. I -- it's been about three rebirths since the 2000 election. You know, they used to talk about the new Nixon. But I think Gore has outdone him...

(CROSSTALK)

SUNUNU: ... rare opportunity to agree with Mark.

CARLSON: (UNINTELLIGIBLE)... SUNUNU: I think that's largely true, if he runs. The primary changes candidates. Any campaign changes candidates. And the one thing that I've learned, just New Hampshire, but I think it has parallels, is, whoever wins a primary is a different, stronger, more focused candidate than when they started the primary.

And if Al Gore chooses not to run, the same will be said of whoever wins the Democrat primary for president in 2004.

HUNT: But John, would you also agree that if he does run, and someone beats him, that's going to give them added credentials, because they will have beaten (UNINTELLIGIBLE)...

SUNUNU: To a certain extent. But the pundits will say, Oh, it was Al Gore. I mean, he really wasn't going anywhere, he didn't have the opportunity. But (UNINTELLIGIBLE)...

(CROSSTALK)

SUNUNU: ... if someone runs and beats him, that's it. He has one more chance to run for president, and if and when he loses, that will be the end of his political career, at least as far as elective office goes.

SHIELDS: Last word, John Sununu.

We'll be back with our CAPITAL GANG Classic, Bill Clinton's selection of Al Gore to be vice president in 1992.

THE CAPITAL GANG discussed this on July 11, 1992. Our guest was then-Senator Daniel Patrick Moynihan, Democrat of New York.

(BEGIN VIDEO CLIP, July 11, 1992)

HUNT: Can the Republicans stick Gore and Clinton with an ultraliberal label?

SHIELDS: Vice President Dan Quayle said, This election should be about character in the final analysis.

Al Gore is going to stand up to that test because the test for his generation, as Bill Clinton is known and suffered from, has become service in Vietnam. Al Gore, virtually alone in the class of '69 at Harvard, went to Vietnam, served...

UNIDENTIFIED FEMALE: This is somebody who has joined the extremists on that issue. The National Taxpayers Union says he is the biggest spender in the Senate. That's quite a distinction. SEN. DANIEL PATRICK MOYNIHAN (D), NEW YORK: I'm for this fellow, and he's an -- he's of our age, he knows his people, his time, a border state. Biggest spender in the Senate? Republicans have bankrupted the country. You can't spend any money in the Senate.

NOVAK: When somebody has got a 92 percent liberal rating and a 0 percent conservative rating, he's a liberal. Al Gore's one of the most liberal members in the Senate.

HUNT: I've covered Al Gore for 16 years, and you can take all the rating services you want. I'll tell you one dog that won't hunt. You will not sell this man as an extremist.

(END VIDEO CLIP)

SHIELDS: Margaret Carlson, a decade later, you look a lot better. No, you weren't there. You hesitate to call -- would you hesitate to call Al Gore a liberal?

CARLSON: Well, Bob and his ilk call him a liberal with a sneer. But knowing what we know now about corporate crime and tax cuts for the wealthy, Al Gore was ahead of his time as a populist in the last campaign.

SHIELDS: A populist...

NOVAK: She didn't answer...

SHIELDS: ... (UNINTELLIGIBLE)?

NOVAK: ... the question. Of course you have to call him a liberal. He's all -- his father, who I knew and liked, (UNINTELLIGIBLE), he was a big liberal. Al Junior is a big liberal. No question about it.

(CROSSTALK)

SUNUNU: Absolutely, but the key was -- liberal, conservative, that wasn't what the election in 1992 was about. That was the election of 1988. In 1992 it was about the economy, and Clinton won.

SHIELDS: John, I hate to say it, I agree with you.

HUNT: Yes, no, I do too. He -- sure he's a liberal, but he's not an extremist. That was the line that they were trying to pedal back then. And he's not an extremist.

SHIELDS: No, I agree, wasn't an extremist. And it is interesting how little it did mean that he in fact had gone to Vietnam and served in '92 or...

NOVAK: He was a journalist in Vietnam...

SHIELDS: ... (UNINTELLIGIBLE) in 2000...

NOVAK: ... he never... (CROSSTALK)

SHIELDS: ... he wore the uniform, and journalists were shot at too. I mean, let's get that straight.

CARLSON: He gave him the (UNINTELLIGIBLE) of his life...

SHIELDS: And he was in -- yes, he joined the Army out of 1969...

CARLSON: (UNINTELLIGIBLE)...

SHIELDS: ... Harvard. You know what?

(CROSSTALK)

SHIELDS: ... your supply-side friends did that, Bob? Did they?

CARLSON: And he was in danger.

SHIELDS: Senator-elect John Sununu, thank you for being with us.

SUNUNU: Thank you. It's been great.

SHIELDS: Thank you, John.

SUNUNU: Thank you.

SHIELDS: Coming up in the second half of CAPITAL GANG, our "Newsmaker of the Week" is Middle East expert Ken Pollack. "Beyond the Beltway" looks at Israeli politics with CNN correspondent Jerrold Kessel. And our "Outrage of the Week." That's all after the latest news following these important, urgently important messages.

(COMMERCIAL BREAK)

(NEWSBREAK)

ANNOUNCER: From Washington, THE CAPITAL GANG.

SHIELDS: Welcome back to the second half of CAPITAL GANG.

I'm Mark Shields, with Al Hunt, Robert Novak, and Margaret Carlson.

Our "Newsmaker of the Week" is Middle East expert Kenneth Pollack.

Kenneth M. Pollack, age 36, residence Washington, D.C., bachelor's degree from Yale, Ph.D. from MIT. Former CIA military analyst, National Security Council staff during the Clinton administration. Currently senior fellow, the Brookings Institution. Author of "The Threatening Storm: The Case for Invading Iraq."

Earlier this week, our own Al Hunt sat down with Kenneth Pollack.

(BEGIN VIDEOTAPE) HUNT: You've argued that containment is not a sustainable policy in dealing with Baghdad. Does that mean that the Hans Blix-led inspection teams over there now are certain to fail?

KENNETH POLLACK, BROOKINGS INSTITUTION: Well, you don't want to say "certain" in politics. Anything's possible. But it is certainly the case that they are not likely to succeed. These inspectors will have some advantages over the old inspection regime, but probably not enough to make it count. And chances are they're not going to find much...

HUNT: President Bush a few days ago in Prague threatened action if Saddam doesn't level about his weapons of mass destruction on December -- by December the 8th. Can Saddam continue to play this cheat-and-retreat game?

POLLACK: I think it really depends on the United States. I think it's pretty clear that the rest of the world is going to be willing to allow him to do so for a while longer. The problem is, is that what Saddam has effectively done is, he has shifted the onus of proof. What he's doing now is, he is forcing the inspectors to prove that he hasn't disarmed, which is almost impossible. It's proving a negative.

Beyond that, what we saw in the 1990s, again, he got so good at hiding his weapons of mass destruction, the inspectors couldn't find anything.

HUNT: You don't think Bush will let him get away with it this time.

POLLACK: That's my sense. I think the administration is moving in that direction. I think the president's statement the other day indicating, in Prague, that the Iraqis had to come clean or that this would be a material breach...

HUNT: Let's assume for a minute that there is an invasion, and the United States follows your recommendation and has at least several -- a force of at least several hundred thousand there. Is it more likely that the Iraqis would break rather quickly, and it would be over with a minimum of casualties and bloodshed, or that -- is there a sufficiently large core of Saddam loyalists that will make it more protracted and bloodier?

POLLACK: My best guess is, it'll probably be somewhere in between the two. we are not going to suffer tens of thousands of casualties. It is not going to take years to win this war, probably won't take months to win this war.

I think most of the Iraqi armed forces are going to collapse rather quickly.

I think you will have a hard core of Saddam supporters, his Special Republican Guard, which is about 20,000 to 25,000 men, probably a large chunk of his Republican Guard, which is about 80,00 men. They probably will be willing to fight pretty hard for Saddam. I mean, after all, the Republican Guard stood and fought to the death in 1991 for Kuwait, which is meaningless to them.

If we do wage this war with a big enough force, as the administration is kind of suggesting it will, we should be able to win it pretty handily, with minimum casualties on our part, minimum is -- Iraqi civilian casualties, and probably a matter of weeks rather than even a matter of months.

HUNT: Is it likely that he will use weapons -- he will use chemical and biological weapons?

POLLACK: I think there's no question he will at some point in time. The key issue is when. Does he use them right at the outset, or does he try to wait? And I think that if the United States handles the operation correctly, both in terms of its diplomacy and the military side, we can probably convince Saddam to hold off on using those weapons of mass destruction, because he recognizes himself that if he starts using them, he's a goner.

HUNT: He has inflicted an extraordinary reign of terror on his people over the last several decades. What implications does that have for a post-Saddam Iraq?

POLLACK: We are going to find, in all likelihood, a deeply traumatized society, a country that has lived under terror for 34 years is one that's going to have a hard time adjusting to a different system of government. We're going to find that the Iraq's -- Iraq's society has been effectively decapitated over the last 30 years.

Every person who was a leader of any stature has basically been killed by this regime, because they were a possible rival to Saddam.

So it's going to take a while before new leaders can emerge in Iraq.

HUNT: Will there have to be a united States presence there for years to come, even a Douglas MacArthur of Iraq, for the foreseeable future?

POLLACK: I don't think the U.S. needs a Douglas MacArthur. I don't think that we need a general in charge of the whole country. But that said, I think we are going to need to maintain some military presence for a while, probably for a number of years...

(END VIDEOTAPE)

SHIELDS: Al Hunt, do I understand Kenneth Pollack to say that even though it cannot be proven that Saddam Hussein has weapons of mass destruction, he should be attacked anyway?

HUNT: No, (UNINTELLIGIBLE), well, (UNINTELLIGIBLE) is that it's just absurd to -- for him to say he doesn't have weapons of mass destruction. They do exist. Ken Pollack is a real expert on this. His book is a marvelous book no matter what your position on Iraq.

And I think he also is quite realistic in saying that the hard part's going to be when this is over, we're going to be there for many years.

SHIELDS: Many years. Bob Novak?

NOVAK: I (UNINTELLIGIBLE) understand if so sure, if you're so positive, Al, I'd like you show me (UNINTELLIGIBLE) the proof of these weapons of mass destruction. I'm not saying they don't have them, but I don't think they've ever made that case.

I -- when I listen to intelligent, experienced, well-informed people like Ken Pollack, who are determined to have a regime change in, in Baghdad, for whatever reasons, because they don't like the regime, I think all this stuff about weapons is just an -- a rationalization for making an attack.

SHIELDS: Margaret?

CARLSON: Well, we may know soon about those weapons. But if you read Pollack's book, you come away believing that Saddam Hussein cannot be deterred, that he is irrational, and does have a suicidal tendency in that he can -- he's always attacking people whom he knows he can't defeat...

NOVAK: Who's he attacked lately?

CARLSON: Well, no one lately, but Iran certainly, and his own people. So I found the book very persuasive for Ken Pollack's case.

SHIELDS: Last word, Margaret Carlson.

Next on CAPITAL GANG, "Beyond the Beltway" looks at a new election campaign in Israel with Jerrold Kessel of CNN.

(COMMERCIAL BREAK)

SHIELDS: Welcome back. Amid continuing attacks by Palestinian suicide bombers, Israel's Labor Party picked Mayor Amram Mitzna of Haifa as its candidate for prime minister in the January 28 general elections. He will face either Prime Minister Ariel Sharon or Foreign Minister Benjamin Netanyahu, who next Thursday will contend for the leadership of the ruling Likud Party.

Mayor Mitzna, a former army general and combat veteran, is a sharp critic of the government's hard-line approach to the Palestinians.

(BEGIN VIDEO CLIP)

AMRAM MITZNA, LABOR PARTY CANDIDATE: I will resume negotiations with the Palestinians without pre-condition, and will offer them to sit again at the negotiations table, basically on the same terms that were addressed in Camp David (UNINTELLIGIBLE). Another chance, maybe the last chance to reach an agreement.

(END VIDEO CLIP)

SHIELDS: Joining us now from Jerusalem is Jerrold Kessel, deputy bureau chief of CNN in Jerusalem. Jerrold, thanks for being with us. Jerrold, does a peace candidate...

SHIELDS: Thank you. Jerrold, does a peace candidate stand any real chance of today's climate in Israel of bloodshed?

KESSEL: You wouldn't think so. You really wouldn't think so. The Israelis have veered dramatically to the right in their voting patterns, but at the same time, those same results in polls and the same opinion polls suggest that Israelis sticking, you could say, to some kind of -- I don't want to call it dovish, but a compromised positions in their policies. They still argue, all the polls show consistently they still say there is need for accommodation with the Palestinians, there is need to talk to the PacifiCare, there is need for compromise to reach an agreement with the Palestinians.

How does one square with the other? I don't know. The pundits say that's what they're asking the Likud, the right wing, to do, or any right wing government, to go ahead and make some kind of accommodation. You wouldn't think, therefore, that a dovish, left wing candidate would have much of a chance, but here we've had a point of Mitzna coming from nowhere, really, and advancing very dovish positions. He didn't really make a campaign of them, but he didn't hide them at all. And he swept the Labor Party. He swept the Labor Party. He won so handsomely in those primaries this week that it was a shock to virtually everybody. He said, not to him, he's a very confident fellow, and he says he can sweep the country too. The country is looking for something new. Whether it's Mitzna, whether it's those dovish policies, that's something else, though.

SHIELDS: Bob Novak.

NOVAK: What would you say, Jerrold, as to the public feeling toward Prime Minister Sharon? Do they feel that his policies, which have been followed by bloodshed and killing, that they are effective? We can only keep -- stay to the course and keep doing this, we'll have some peace?

KESSEL: One of the amazing things in Israeli politics of the last year or year and a half, two years, has been the way Ariel Sharon has managed to position himself at the center of Israeli politics. He is the veteran politician, no man from the right, no hard-liner, as his image was -- as he was perceived to be, as his image had him as being, not the man who went to war over Lebanon, not the radical soldier in his youth who took his role into all kinds of escapades -- a very solid statesman man.

And that's the way he's coming across to the majority of Israelis still at this day, despite the fact that his policies haven't brought the Israelis what he promised to bring them -- either security, or peace. It is something of a mystery, but Sharon is continuing to stand firm on his line, and all the polls show, it has the support of most of the people.

I think the one secret ingredient that Sharon has going for him all the way is the United States, President Bush. The fact that Mr. Sharon and Mr. Bush seem to be so lined up with alliance with each other, that's really reassuring for most Israelis, so where they say perhaps he hasn't yet achieved what he set out to achieve, perhaps it's difficult for him to do so, but he's there, right alongside the president of the United States. The United States president believes in Mr. Sharon's policies. It seems to be good enough for the majority of Israelis at this stage, anyway.

SHIELDS: Jerrold, we only have two minutes. Margaret Carlson and Al Hunt would like to talk to you.

CARLSON: Jerrold, Bush may prefer Sharon, and is it possible that Arafat may as well, in that if you get a left wing, dovish prime minister that the Palestinians don't have any -- as much of an excuse for their own behavior?

KESSEL: That's a jolly good way of putting it. You know, Arafat has been credited with crowning prime minister after prime minister after prime minister in Israel. One doesn't really know where he stands with regard to a dovish prime minister, vis-a-vis, say, a hard- liner like Netanyahu or Sharon, but I think what you can say is if he doesn't want a national unity government, he doesn't want Sharon having the backing of Shimon Peres and the Labor Party in which to carry out his policies. He wants to see either or, either a dovish policy, as he keeps saying with that, I had with my partner Rabin, the late Prime Minister Yitzhak Rabin, or he'll say, let's face up to a real hard-line Israeli government, and then they will be exposed for what they are. But Arafat, something of a mystery. Perhaps, though, he's less of a player than he used to be in the past.

SHIELDS: Al Hunt.

HUNT: Jerrold, do I take it from your earlier comments that most people there think that Sharon is clearly going to beat Bebe Netanyahu for the Likud Party nomination, and what would the differences be between Netanyahu and Sharon government?

KESSEL: Yeah, I was waiting for that. I think we have to -- I mean, nothing certain in Israeli politics, nothing certain, as you know, in any politics, but it certainly seems that way. Mr. Sharon seems to have managed to position himself at the solid center, and unless the Likud Party, who vote to -- almost 300,000 who are party members have the ability to vote next Thursday, really go for the hard line and say, Sharon's polices haven't worked, we've got to switch to Netanyahu. All the polls are indicating, no, Sharon will come out on top, and then it will be more of the same, really, and he'll have to face off against Mitzna.

Netanyahu is trying to position himself -- position Sharon as being aligned to Mitzna, saying, he wants a Palestinian state. That's disastrous. He's saying Sharon is almost as bad as the Labor Party. It's a very risky gambit from Mr. Netanyahu. Maybe it has a chance, but the polls suggest, he doesn't.

SHIELDS: OK, Jerrold Kessel, thank you so much for being with us. THE GANG will be back with the "Outrages of the Week."

(COMMERCIAL BREAK)

SHIELDS: Now for the "Outrages of the Week." Millions of American patriots who served their country in uniform for 20 years or more and who put their lives at risk in battle have been promised by the United States government that they will receive free lifetime health care. Even though the government conceded the promises had been made, the U.S. Defense Department convinced a federal appeals court that no valid contract existed, because the promises were not enforceable at law. Many veterans were forced to pay medical bills from their own meager savings. This is no way an honorable people treats their brave warriors.

Bob Novak.

NOVAK: At the NATO Summit in Prague, a Canadian senior official, Francoise Ducros, the prime minister's communications director, was overheard referring to George W. Bush as, quote, "what a moron!" end quote. Opposition MPs in Ottawa called for her resignation, but she only reflected the angry Canadian delegation -- angry because President Bush's administration is pressing for higher Canadian defense spending. In NATO, Canada spends third from the bottom, above only Luxembourg, and a country with no military at all, Iceland.

Now, who are the morons?

CARLSON: Mark, I'm glad Bob doesn't overheard what I call him.

Some litigious adolescent fatties think two all-beef patties, special sauce, lettuce, cheese, pickles, ketchup on a sesame seed bun is the source of their flab. Not indulging parents, or the absence of a little voice that says, "Enough, you porker." No, it's McDonald's, which has the nerve to serve a quarter-pounder, a chocolate shake and the best French fries outside Paris. Lawsuits like this make it hard for the truly injured to be heard. To the court: Keep an eye on our fries and dismiss this case.

SHIELDS: Al Hunt.

HUNT: Remember, just two years ago, during the Florida election fiasco when the Republican Party insisted a cardinal principle in any recount was that all votes must be treated the same -- different counties couldn't apply different standards. The GOP, however, did 180-degree turn in a hotly contested race for the new Colorado (UNINTELLIGIBLE) CD (ph), where they are clinging to a tenuous 122- vote lead. Don't be fooled by cries of principles. When it comes to recounts, what both sides want is simply to win.

SHIELDS: This is Mark Shields saying good night for THE CAPITAL GANG. Coming up next, "LARRY KING WEEKEND."

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Running for President?; 'Beyond the Beltway': A Look at Israeli Politics>